Thursday, January 26, 2012

Brain Drain Boondoggles: New Mexico Tax Credit

A bill to reverse brain drain in New Mexico advanced Wednesday, though in slimmed-down fashion.

The proposal would give tax breaks to state businesses that hire students who graduate from New Mexico universities with advanced degrees in select fields.

To qualify for the $5,000 tax credit, a company would have to employ somebody with a master's or doctorate in science, technology, engineering, math or health from one of the state's three research universities. ...

... A company would get the tax credit if it hired a graduate for a full-time job with benefits for at least seven months in the first year.

Hey, leave the brain drain out of this. Call a tax cut a tax cut. Heck, it's really a subsidy. The money will suppress wages. Companies love a hometown discount. New Mexico wants to add some gravy to that meal. The bill has bipartisan support.

Graduates who would have stayed regardless (likely a strong majority) also represent a tax credit opportunity. A few who might have left will stay. The per capita cost for that brain gain will be astronomical. In essence, Republicans duped Democrats into slashing state revenue, all in the name of brain drain.